My Top 4 best vanguard funds UK 2022

To help others with financial independence goals, I thought I’d list out my top 4 best vanguard funds UK.

Selecting a stock and shares to invest in is a completely personal decision. There are different funds that suit different people and purposes, and ultimately nobody could know if any of the below funds will go up or down in value. As per every investment, the value of these funds could go either up or down.

Having said this, in my opinion, these are the Top 4 best Vanguard funds UK 2022.

Selection Criteria

There’s a number of different factors that I use to determine which fund to invest into. These are

  1. Past performance. Whilst past performance is no a guarantee for future performance, if a fund has been underperforming for the last five years, I think it’s a bad sign.
  2. Environmental credentials. This is an often overlooked consideration, but personally I think it’s increadibly important. If the fund is heavily vested in unsustainable companies, I feel that it will both do poorly long term whilst harming the environment.
  3. Ratio of stocks to bonds. This can be particularly important for determining how risky an investment you want. Funds with higher levels of bonds tend to fluctuate in value less. Given I intend to have my shares for the long run, I’m happy to be relatively risky with a stocks and shares isa at this stage.
  4. Geographical diversification. Having funds accross multiple countries helps protect againt sudden issues that may be localised to one of them (e..g. Brexit).

Following these considerations, I’ve settled on the following five best vanguard funds uk.

ESG Developed World All Cap Equity Index Fund – Accumulation

Top 4 best Vanguard funds

This passive fund is an ESG fund ( environmental, social, and corporate governance) that looks to accumulate more value as shares go up. This tracker fund aims to match the performance of 4,357 stocks. FTSE Russel, an independent party, screens the companies to exclude any that perform poorly on ESG ratings. In particular, this means that companies that hold high reserves of non-sustainable fossil fuels (read oil) will not be included.

Amazingly this v has not had an interest rate of less than 6.66% over the last five years. Impressively, if you’d invested £10,000 five years ago, it’d now be worth a staggering £18,309.

You can read more about this fund here.

LifeStrategy 80% Equity Fund – Accumulation

This Fund takes a slightly different approach, with a 20% proportion of the funds being held as bonds. You can see from the graph above, that over the last five years this fund has typically underperformed compared to pure stock funds. Realistically, that only tells half the story. Over time you’ll see the value of this fund fluctuate significantly less, with less dramatic drops and rises. This fund is a more steadfast approach. The Lifestrategy aspect of the fund is Vanguard’s way of saying they’ll sell shares (or bonds) to continuously keep the 80/20 split. This fund is rather skewed towards UK shares though, making it more susceptible to UK localised events affecting its overall value.

If you had invested £10,000 five years ago, this would currently be valued at £15,449. This is around £3000 lower than the ” ESG Developed World All Cap Equity Index Fund – Accumulation ” fund at the time of writing, but that’s part of having a lower risk fund.

You can read about this here.

FTSE Global All Cap Index Fund Accumulation

This fund is often considered the “default” for most people getting into FIRE. It comprises 7,010 stocks globally giving it a very diverse portfolio of shares. There aren’t five years of figures, but £10,000 would have net you £17,161 if you’d invested when the fund was initially created. Once again this is largely swayed towards North America with roughly 60% of the funds based there. This is common because a lot of the big companies are based in North America and are often pulled into these funds.

The fund has no ESG selection criteria, which detracts from it, but this is one of the most diversified funds in this list because of it.

You can read more about this fund: here

ESG Emerging Markets All Cap Equity Index Fund – Accumulation

This vanguard etf is more of an added bonus than the funds above. In fact, if you take a look at it you can see that its performance is significantly lower than the comparative funds. Personally, I think that there’s a good chance that some emerging markets are likely to grow well. However, this fund is swayed heavily towards China, with almost 40% of the fund in Chinese companies. With the long-term strategies China can implement, I think it’s possible that this fund will do very well in the long term. Furthermore, the ESG aspect of this means that the least ethical shares will be filtered out from inclusion.

As it stands, this is the one fund that I do not have any funds invested in. However, I’ll be watching it closely to see how it performs.

You can read about this here.

Summary of vanguard funds UK 2022

Each of these Vanguard funds has a slightly different take on establishing a passive fund and each of them will inevitably perform differently over the coming years. When considering a fund please note that:

Past performance is not a reliable indicator of future results.

The value of investments, and the income from them, may fall or rise and investors may get back less than they invested.

Ultimately, there are no perfect or guaranteed funds. But this list comprises what I think personally, are my Top 4 best Vanguard funds UK 2022.

Overall this page is identifying the best vanguard funds for retirement, if you have a more specific short-term goal, you may well be better off investing in a less risky solution. Whilst vanguard ETFs are a powerful tool, they’ll always be inherently riskier than something like premium bonds.

Do you have any other funds you prefer? I’d love to know, if you do please drop a message in the chat.

6 thoughts on “My Top 4 best vanguard funds UK 2022”

  1. Hi, ive invested in the ftse developed world ex uk equity index fund acc and have so for around 6months now, fairly cheap charges 0.14 and a decent past record. I think it compares similarly to the ftse global all cap, what do you think long term.

    1. Thanks for the input Craig, good to know it’s working for you. I think long term it’s difficult to predict, personally, I like the thought that *some* of my funds are working to expand UK business too.

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